Opennings : Head of Corporate Finance

Vacancies in Islamic finance industry

from efinancialcareers.com

A career growth opportunities for Head of Corporate Finance with a very attractive Tax free package in one of the leading Banks in Abu Dhabi GCC and Islamic Banking Experiences is Favorable

http://jobs.efinancialcareers.com/job-4000000000588425.htm/keywordAny=islamic%20bank/

RAM Places Lekas’ Bonds On Rating Watch, With Negative Outlook

RM785 million (rated at AA3), Junior Sukuk Istina’ of up to RM633 million (rated at A1), RM240 million Redeemable Convertible Unsecured Loan Stocks Programme (rated at B3) and RM50 million Redeemable Unsecured Loan Stocks (rated at B3) on rating watch with a negative outlook.

 The rating watch is premised on the cessation of construction works on the Kajang-Seremban Highway in the Taman Bukit Margosa area, and potentially lower traffic plying the highway as a result of the delay in completion of the Taman Bukit Margosa area, RAM said in a statement on 30th of Dec, 2009.

 On 12th of Nov, 2009, LEKAS was directed to stop construction works of the highway in the Taman Bukit Margosa area, where the Seremban High Court allowed the application of an injunction order to stop work by residents of Taman Bukit Margosa against LEKAS and 11 others.

 On Dec 10, 2009, the hearing for the defendants’ application to strike out the civil suit which includes compensation claims of RM112 million by the plaintiffs was deferred to March 1, 2010.

 LEKAS has thus been unable to resume construction of the highway in the Taman Bukit Margosa area.

 In the meantime, LEKAS is in the midst of applying for a stay on the injunction order while the next hearing date remains to be fixed.

 “We highlight that there will be downward rating pressure if LEKAS is unable to complete and open the highway to the public by mid-June 2010, which will result in loss of tolling revenue, or if the company is found to be liable for compensation to the plaintiffs,” RAM said.

The rating agency said it will continue to monitor the traffic volume of the highway.

 “We have highlighted that it is imperative for the traffic volume to reach 65,000 average daily traffic during the first full year of operations, with long-haul commuters who travel from Seremban to Kuala Lumpur city or vice versa making up at least 50 per cent of the total traffic volume,” it said.

 “There will be downward rating pressure if the traffic volume build-up is slower than expected,” it added.

source : bernama

Malcolm Wall Morris joins Sharia Capital board

Islamic financial services provider Shariah Capital has appointed commodity and derivatives expert Malcolm Wall Morris, 38, as a non-executive director.

He replaces David Rutledge, who has stepped down from the board from 29th of Dec, 2009.

Wall Morris, formerly CEO of DGCX, the Dubai Gold & Commodities Exchange, has also replaced Rutledge as CEO of the Dubai Multi Commodities Center. Rutledge recently retired after six years at the DMCC.

Shariah Capital is a U.S.-based company that creates and customizes Shariah compliant financial products and platforms and provides selective Shariah consulting and advisory services primarily to global financial institutions and investment firms with product initiatives directed to Islamic investors.

source : ibtimes

Islamic Emirates and Sudan Bank gets approval

Sudan’s central bank has given its approval for the fully Islamic US$200 million Emirates and Sudan Bank to be set up in Khartoum, the country’s capital; it was announced on Dec 28th, 2009.
 

The new bank, which is backed by a number of leading Islamic financial institutions, is expected to begin operations in January 2010 and plans to quickly expand out of its Khartoum headquarters and create a network of branches throughout the country. All its operations, services and products will be fully Shariah compliant.

The crucial backing of Sudan Bank, the central bank, has opened the door to the full establishment of Emirates and Sudan Bank with a declared capital of $200 million and paid capital of $100 million. Dr. Mohammed Khalfan Bin Kharbash, UAE Finance and Industry minister and chairman of the founders’ committee of Emirates and Sudan Bank, said: “Our aim in setting up this bank is to support the economic development of Sudan.” Dr Kharbash, who is also Chairman of Dubai Islamic Bank (DIB), added: “The creation of the new bank draws tighter the historically close ties between Sudan and the UAE, a great supporter of economic and trade cooperation between Arab countries. He added: “UAE investors reacted enthusiastically to the opportunity to set up the bank.

“Sudan’s economic indicators are generally positive and forecasts for gross domestic product, balance of payment, balance of trade, exchange rates, and foreign investments suggest that the country is poised for an economic upswing, particularly after the latest developments to do with the peace treaty.

“It is crucial to the country’s further progress that it has solidly established banks and financial institutions with the resources and facilities to offer a service that can facilitate international transactions.” Dr. Kharbash confirmed the bank would soon begin to offer a full range of Shariah-compliant services and products that meet the needs and requirements of all sections of the Sudanese community, both business and retail.
 
He added that the bank would perform a crucial role in inter-bank and regional financial transactions and investment. A range of retail and corporate banking services will be offered and Emirates and Sudan Bank has confirmed it will invest in developing local staff to service its planned branch network. Sudan has become a magnet for investors, businesses and financiers since the signing of a peace treaty between the north and south of the country. It is believed to have large reserves of oil.

source : ITP

Opennings : Head of Asset Management

Jobs in Islamic finance industry

This bank is a top 5 institution in Saudi Arabia with a very good network and client list.  They have about $1bn in funds under management and need to hire someone who knows the Saudi market and also can speak Arabic.  This is an excellent opportunity to join a firm that is growing and building a very strong brand name in the GCC region.

http://jobs.efinancialcareers.com/job-4000000000586348.htm/keywordAny=islamic%20banks/

Islamic Banking and Finance Education – Sri Lanka

First Global Knowledge Centre (FGKC), the pioneer in Islamic Banking and Finance education in Sri Lanka has introduced another innovative programme of study in this rapidly expanding field.

Branded as iBanker, this is a unique diploma level course which covers not only Islamic Banking and Finance but also conventional banking, risk management, and investments.

The emerging industry of Islamic Finance needs qualified people who can contribute positively towards the success of the field. But unfortunately statistics show there is an acute shortage of such a knowledgeable workforce at present. One objective of the introduction of this course by FGKC is to assist the industry by filling this void. For those who wish to pursue higher studies in Islamic Banking or Finance the course will be a stepping stone; which is another objective of the course designers.

Another feature of this course is that it covers the syllabus of the popular world recognized Islamic Finance Qualification exam (IFQ) of the Chartered Institute for Securities & Investment, UK. Therefore, this can be considered as a two-in-one programme which allows a student to get a recognized diploma and also to sit the IFQ (UK) exam.

FGKC is the only accredited training provider in Sri Lanka for the prestigious Chartered Institute for Securities & Investment (CISI), UK which offers the Islamic Finance Qualifications (IFQ). It is also accredited to offer IFQ in the Maldives, Qatar, Bangladesh and Pakistan.

The Chartered Institute for Securities & Investment (UK) is the largest and most widely respected professional body for those who work in the securities and investment industry. Formed as the “Securities Institute” in 1992 by the members of the London Stock Exchange, the Institute got charter status in November 2009.

For those who are interested in obtaining professional membership of an internationally recognized body in the shortest possible time, IFQ is the ideal route. The IFQ course at FGKC is of 3 months’ duration and at its conclusion, one can sit the exam which is conducted in collaboration with the British Council, Colombo.

The faculty of First Global comprises of practising and highly qualified experts and academics with a flair for teaching. The students immensely benefit by the lecturers’ industry exposure as they gain an insight into the real life applications of theory learnt.

The facilities of the institution include comfortable AC classrooms, a comprehensive library, IT facilities with access to numerous valuable E-Materials related to Islamic banking, finance and related subjects.
Islamic Banking Finance is an ideal discipline for those who are interested in pursuing a career in a dynamic and vibrant environment.

A world of opportunities awaits those who have the vigour and passion to take up the challenge.
The financial and other career benefits that can accrue from one’s involvement in the industry are tremendous.

source : muslimguardian.com

Azerbaijan to sign agreements worth $200m with Islamic Development Bank

 
Azerbaijan is preparing a set of agreements to be signed at the 35th annual meeting of the governors of the Board of the Islamic Development Bank.

The agreements on two projects are estimated to be worth $200 million, according to a government source.

“We are also working on a project with the Saudi Development Fund, which may be signed during the annual IDB meeting as well,” the source said.

The annual meeting of the Islamic Development Bank will take place on 23-24 June 2010 in the Gulustan Palace in Baku.
A specialist mission of the bank is to visit Baku this week to work on preparations for the meeting.

The chairmanship of the IDB Board of Governors will be held by Azerbaijan for the first time in 2010.
Since Azerbaijan entered the IDB Group in 1992, the bank has given the country financial support of $280 million.

source : AZ news

Expert says Islamic banking is not practicable in India

Given the current banking sector regulations in the country, Islamic banking is not practicable in India, said Mufti Abdul Kadir Barkatullah, a British expert on Islamic banking and finance.

Since giving or taking interest is against the Sharia laws, Islamic banks need to look to other areas, such as trading, to generate profits to meet their costs. In India, banks are not allowed to get involved in trading and hence Islamic banks cannot survive, the India-born Mr. Barkatullah pointed out. The Raghuram Rajan recommendations on banking reforms, if implemented, would accommodate Islamic banking institutions.

However, several other areas of finance, such as real estate funding and venture capital, were Sharia-compliant and hence Islamic finance had a lot of growth potential in India. (Islamic banking, according to Wikipedia, `refers to a system of banking or banking activity that is consistent with the principles of Islamic law (Sharia) and its practical application through the development of Islamic economics.’) Mr. Barkatullah, who is a senior Imam of Finchley Mosque in London and prominent Sharia scholar with an educational background in Economics and Finance, pointed out that profit was not anathema to Islamic finance, only, but it should be principle-guided. It was driven by two major principles: the economic activity should not cause harm to society as well as to individuals; and, that risks and rewards should be shared — not rewards alone. The economic activity should be fair, equitable, transparent and based on clearly laid down terms.

Mr. Barkatullah, who is also adviser to several banks, pointed out that Islamic banking, which was just three decades old, was still a developing concept and would take time to stand on its own. It thrived in several Western countries, especially Britain, though at a micro level. Nearly one-fifth of the Islamic bank customers in Britain were non-Muslim.

source : thehindu

Luxembourg advised of more involvement in Islamic finance

THE Luxembourg office of PricewaterhouseCoopers (PWC) in a report on Islamic finance published at the end of October 2009, has urged greater involvement and visibility from the Luxembourg government and regulators if it is serious about establishing the principality as a European Islamic finance hub especially for Islamic funds and sukuk.

Compared to regulators in the UK, Ireland and France, the Luxembourg regulators have never approached their counterparties in target countries such as Saudi Arabia, the UAE, Kuwait, Bahrain and Malaysia to seek cooperation on Islamic finance.

PWC, the international auditors and consultancy, has based its report on the recommendations and conclusions drawn from an Islamic finance meeting. The report suggests that Islamic finance is an important niche business for Luxembourg. Some 16 sukuks are already listed on the Luxembourg Stock Exchange. For instance, the $1.5bn Petronas EMAS sukuk issuance in August 2009 was listed in Luxembourg in preference to the London Stock Exchange.

In addition, there are more than 31 Islamic investment funds, mainly global equity and real estate funds, registered and domiciled in Luxembourg. The PWC report stressed that the future target of Luxembourg Islamic funds should be investors in Europe, although this will require an educational process to attract investors amongst Europe’s Muslim population of around 20-25 million. The report also stressed that Luxembourg should leverage its strong private banking industry, its good reputation and its cost-competitiveness as a financial center. As such, there is a potential for cross selling Shariah-compliant products to these investors.

In a rare foray into Islamic finance, Yves Mersch, governor of the Central Bank of Luxembourg, in a speech at the Islamic Financial Services Board (IFSB) in Kuala Lumpur earlier this year, stressed that “despite the current turbulences, the market practitioners of Islamic finance in Luxembourg remain optimistic that Islamic finance is likely to grow steadily in the next few years based on investors’ appetite for financial products based on sound ethical principles.”

Mersch warned that numerous challenges remain, however, including regulatory changes, legal certainty, illiquidity issues, liquidity management risk concerns, the need for harmonized regulation, regulatory disparity amongst national supervisors and a lack of level playing field. It is crucial to ensure that Shariah principles are able to accommodate the innovative products which would allow the integration of Islamic finance into the international financial system.

Mersch confirmed that market players in Luxembourg want formal recognition of Islamic financial products and accounting standards. “Our authorities have proved pragmatic, innovative and adaptive to the financial landscape. According to discussions currently being held at the national level, this will also be the case with regard to Islamic finance,” he declared.

Although the Luxembourg authorities have set up an Islamic finance Taskforce, bringing in various regulators, professional associations and market players, actual progress in the facilitation of Islamic financial products in Luxembourg remains slow and bureaucratic.

It would be difficult to have full fledged Islamic banking operations in Luxembourg due to a legal and regulatory framework. For example, it is not possible for Luxembourg banks to provide bank accounts without any risk cap, which is typical for an Islamic bank. In addition, Islamic banking requires banks to have partnership accounts.

The PWC report also highlighted concerns from market players in Luxembourg about various risks associated with various Islamic financial products and practices, although some of these concerns betray some ignorance about Islamic finance.

Islamic funds are almost all done through manual transactions. This leads to higher risk, for example accounting of revenues and purification of interest. Compliance issues such as eligible assets and investment restrictions are not monitored, as these are dealt typically by Shariah boards. There is also a perception of a lack of information sharing in relation to cleansing and eligible charitable organizations. The report calls for rules of charities should be demystified. However, the total amount of money purified is insignificant and money laundering risk is therefore limited as most of the Shariah compliant funds in Luxembourg are equity funds.

These latter points are unimaginable in markets such as Malaysia and even Turkey. Perhaps it reflects more on the inability of the fund managers and their lack of engagement in navigating through these issues. Sharing of information is a requisite in Islamic finance otherwise the transaction could be non-permissible because of Gharar (deception or non-disclosure), which is proscribed by the Shariah. Such concerns are not new and typical of some jurisdictions new to Islamic finance.

Fiduciary risk is not much different than for conventional funds with respect to OTC (over the counter) products. A large portion of sukuk is listed and managers have not yet invested in sukuk privately placed, thus mitigating risk to a certain extend. Assets are generally held by sub-custodians implying settlement and custody risk.

The report also stresses that default risk must also be taken into account since the emergence of the first occurrences of sukuk defaults earlier this year, which include East Cameron Gas Sukuk, the Investment Dar Sukuk, and the SAAD/Al-Gosaibi Sukuk.

In terms of valuation risk, the report stressed that there is no clarity on valuation parameter for investments to be obtained by counterparties or the Shariah board.

The report also identified a number of compliance risks. Participants, for instance, mentioned that no Shariah compliance checks are made as it is not a market practice and it is the responsibility of the Shariah board.

A service fund administration can send a report to the board of directors but will not check if investments are Shariah-compliant. Shariah compliance is part of the investment policy and should be checked by the manager from an eligibility an d risk spreading point of view. The question remains, however, if asset managers have the knowledge to check such compliance issues.

It is, however, difficult to put the compliance checks in a system in comparison with conventional funds as compliance rules might be non-standard (changing) and are somehow based on judgment. This requires more flexibility than for a conventional fund.

source : dailyme

Malaysian bank governor stresses strong liquidity management

Islamic financial institutions need to address their ability to manage liquidity urgently, a Malaysian official said here on Tuesday.

Governor of Malaysia’s central bank Zeti Akhtar Aziz said at a conference on financial stability that the recent financial crisis in advanced economies had demonstrated the consequences of liquidity constraints.

The turmoil had also underscored the importance of a strong and well-developed liquidity management infrastructure, added Zeti.

In order to facilitate effective cross-border liquidity management, Zeti said that the Islamic Financial Services Board (IFSB), in collaboration with the Islamic Development Bank (IDB), had established a liquidity management task force.

Hoping that the framework developed by the task force could be set in place in 2010, Zeti also called for the regulatory and supervisory framework to be strengthened.

The IFSB is an international standard-setting organization that promotes and enhances the soundness and stability of the Islamic financial services industry by issuing global prudential standards and guiding principles for the industry.

The IDB is an international financial institution established in pursuance of the Declaration of Intent issued by the Conference of Finance Ministers of Muslim Countries in December 1973.

Touching on the development of Islamic banking in Malaysia, Zeti said the system had become a vibrant one in the country with banking assets accounting for 18.8 percent of the total banking assets.

Zeti noted that Malaysia had an efficient functioning Islamic money market traded in the domestic currency with greater monetary flexibility in the system, drawing wider participation from the international financial community.

Zeti also said that when Islamic finance continued to become an integral part of the global financial system, the current scope of cooperation framework could be broadened to deal with confronting new challenges.

sourece : pdo